In this short article we will explain some important steps to take when filing taxes as related to payments that your business has processed for the prior year.
Both your bank and payment processing provider will provide a report of gross annual payments processed to you and the IRS. This is reported on Form 1099-K. Make sure you obtain this form on time to file your taxes.
Any transaction where a card is accepted as payment is recorded and counted in the gross annual payment amount. All transactions your business received in the past year are included.
If your business issued a refund or has incurred a chargeback, make sure your bank does not declare that revenue on your Form 1099-K.
Businesses that fail to provide correct information in a timely manner could be placed on backup withholding on up to 28% of all volume submitted until a correction is made.
At PolyPay, we are happy to review your statements in order to identify data discrepancies and cost-saving opportunities. Developing and maintaining clear and consistent reporting now will benefit you and your business in the long run.